Trends in coffee

EARLIER this year, the International Coffee Organisation recommended farmers in Sub-Saharan Africa to seek crop certification to help them improve the product quality and sustainability, thus raise income. In 2013-14, this region will account for over 16 million bags of coffee against a global output of 150 million bags, according to the US Department of Food Agriculture.

Coffee consumption has been largely influenced by the steady growth of the speciality coffee sector for the past 10 years. A rising number of independent micro roasters with single origin coffees are now competing with major chains. Mauricio Galindo, head of operations at the International Coffee Organisation said this development has brought forth a new type of consumer: one who knows about good quality coffee and who cares how it was sourced and produced.

Mauricio Galindo, head of Operations, International Coffee Organisation

Another market driver is a huge trend in North America and Europe for single serve, capsule pods. The novelty appeal, plus the consistent quality of these capsules ensuring that consumers get exactly the same cup of coffee every time, has contributed to its popularity.

A third factor changing the face of coffee consumption is certification, such as those from UTZ, Rainforest Alliance, Fairtrade, and Organic. Apart from allowing consumers to know that the coffee they are buying meet a certain set of environmental and social standards, these certifications help farmers achieve better agricultural practices.

Another important development to do with coffee is the change in perception about its health aspects, said Mr Galindo. The idea that coffee is unhealthy has been disproved and to the contrary, potential health benefits are now associated with moderate intake of coffee.  He is confident that future demand is going to be buoyant. “Coffee consumption is growing and in fact, the challenge is more in terms of supply. Today when you look at the market, there is surplus – but that is now.  In two years the market will be balanced again. From then on it is not clear what will happen…”

It is vital for countries to reliably and consistently plan and implement policies that would help develop the coffee sector, responding to the needs of the markets and at the same taking into account the best agronomic practices and current needs of farmers in the field.

Technical advice should be made available and delivered efficiently through extension services. He emphasises the importance of financial education. “We want to make sure that coffee farmers begin to see their farms as micro industries if we want to make sure there is an adequate supply of quantity and quality the industry wants to have in the future to be able to satisfy the increasing demand for coffee. We have to see that farmers see themselves as small entrepreneurs… guys who understand cash flows, who understand risk management and who know how to get access to finance.”

He also stressed the importance of public and private partnerships (PPP) to help realise the kind of action that needs to take place. ICO is currently working with 4C Association to develop a business verification scheme—a common code for the coffee community that can help address issues relating to sustainability, climate change, market access, and profitability. 

The ICO would also like to increasingly play a role to help public and private sectors look at policies and strategies that could improve the efficiency and productivity of their coffee sector. “And certainly we are very willing to engage more with coffee growers in Asia,” he said.- CRISTINA DOUTHWAITE